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The Modern Age of Fraud and Abuse Compliance
1. The Modern Age of
Fraud and Abuse Compliance
PSOW 30th Annual Workshop
September 21, 2017
Tundra Lodge Hotel & Convention Center
Green Bay, WI
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Wendy Arends, Esq.
Godfrey & Kahn, S.C.
3. Government Enforcement
Federal
HHS – U.S. Department of Health & Human
Services
OIG – Office of Inspector General (within HHS)
CMS – Center for Medicare and Medicaid Services
U.S. DOJ – U.S. Department of Justice
State
WI AG – Wisconsin Attorney General’s Office
WI DHS – Wisconsin Department of Health Services
WI OIG – Office of Inspector General
(within WI DHS)
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4. Other Governmental Entities
• ZPICs – Zone Program Integrity Contractors
− Developed by CMS in 1999
− Ability to initiate a fraud investigation
− ZONE 3 – Safeguard Administrators
• Operational April 24, 2012
• IL, IN, KY, MI, MN, OH and WI
• RACs – Recovery Audit Contractors
− Identify and correct Medicare improper payments
− Can implement actions that will prevent future
improper payments in all 50 states
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6. Anti-Kickback Statute
• The AKS (42 U.S.C. § 1320a-7b) provides that it is:
− Unlawful to knowingly and willfully, solicit or receive
any remuneration (directly or indirectly, overtly or
covertly, in cash or in kind)
− In return for referring any item or service reimbursable
by federal health care programs, or purchasing,
leasing, ordering or arranging for (or recommending
any of the same) any good, facility or service
reimbursable by federal health care programs (e.g.,
Medicare or Medicaid)
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7. Anti-Kickback Statute
• 3 required elements for a violation:
−Intentional act
−Direct and indirect payment of remuneration
−To induce the referral of patients or business
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8. Anti-Kickback Statute
Statutory Exceptions and Safe Harbors:
• Discounts;
• Employees;
• Group purchasing organizations;
• Sale of a practice;
• Referral services;
• Warranties;
• Investment interests;
• Space rental;
• Equipment rental;
• Personal services and management contracts; and
• Waiver of deductibles and coinsurance.
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9. What is Remuneration?
• An extremely broad definition, whether in case or in kind,
and whether made directly or indirectly, including:
− Kickbacks;
− Bribes;
− Rebates;
− Gifts;
− Above or below market rent or lease payments;
− Discounts;
− Furnishing of supplies, services or equipment either free,
above or below market;
− Above or below market credit arrangements; and
− Waiver of payment due.
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10. False Claims Act
• FCA (31 U.S.C. §§ 3729-3733)
• Prohibits a person from “knowingly” submitting claims
or making a false record or statement in order to
secure payment of a false or fraudulent claim by the
federal government:
− Has actual knowledge of the information,
− Acts in deliberate ignorance of the truth or falsity of
the information, and
− Acts in reckless disregard of the truth or falsity of the
information.
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12. False Claims Act
• Potential FCA violations include:
−Upcoding/billing for services not rendered
−False certification of compliance with regulations
−Quality of care/unneeded services
−Improper retention of overpayments
−“Causing” submission of false claims
• Does not cover false tax returns
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13. 2015 CMS Study
• In 2012, Medicare Part B paid $5.8 billion for
ambulance transports, almost double the amount
paid in 2003.
• CMS study looked at inappropriate payments and
questionable billing for Medicare Part B ambulance
transports
• Data included transport destinations, transport levels,
distance of urban transports, other Medicare services that
beneficiaries received, and the geographic locations
where the beneficiaries who received transports resided.
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Source: HHS, OIG. Inappropriate Payments and Questionable Billing for Medicare Part B Ambulance Transports (OEI-
09-12-00351) September, 2015
14. 2015 CMS Study Findings
• Identified both improper payments for ambulance
transports and questionable billings by ambulance
suppliers:
− Medicare paid $24 M for ambulance transports that did not
meet certain Medicare requirements justifying payment
− Medicare paid $30 M for transports for which the
beneficiaries did not receive Medicare services at the pick-
up or drop-off locations, or anywhere else
− 1 in 5 suppliers had questionable billing
− More than half of all questionable transports were provided
to beneficiaries residing in 4 metropolitan areas
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15. 2015 CMS Study Recommendations
• Enhance existing fraud and abuse safeguards
• Require ambulance suppliers to include National Provider
Identifier of the certifying physician on transport claims
that require certification
• Increase CMS monitoring of ambulance billings
• Determine the appropriateness of claims billed by
ambulance suppliers identified in the report and take
appropriate action
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16. Recent Cases – Navicent Health
• OIG - August 2017 settlement with Navicent
Health, Inc.
−Navicent agreed to pay $2.5 million and enter into
OIG corporate integrity agreement.
• Alleged False Claims Act violations:
−Upcoding non-emergency hospital to hospital
ambulance transports as emergency claims
−Billing for non-emergency ambulance transports
of patients released from the hospital
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17. • OIG – January 2017 settlement with MedStar (MA
ambulance provider)
− MedStar agreed to pay $12.7 million; entered into OIG
corporate integrity agreement
− Former employee brought whistleblower case
• Alleged False Claims Act violations:
− Billing for higher levels of services than what patients
required
− Submitted claims for ambulance transport services
that did not qualify as medically necessary
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Recent Cases – MedStar Ambulance
18. Other Recent Cases
• In each case below, the ambulance provider entered into
a settlement agreement with OIG to resolve the alleged
FCA violations:
− 3/31/17 – Freedom Ambulance, LLC (Beeville, TX) agree to
pay $846,563
− 3/31/17 – EasCare, LLC (Dorchester, MA) agreed to pay
$255,768
− 11/28/16 – Mitchell Jordan (Mattoon, IL) agreed to pay
$126,425
− 5/5/16 – Allied EMS Systems, Inc. (Petoskey, MI) agreed to
pay $121,722
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19. Compliance Program
• Strategies to avoid fraud and abuse violations:
−Develop or strengthen compliance program
−Designate someone to be in charge of
compliance program
• For example, high level manager can act as
compliance officer; larger organizations may also
want to create a compliance committee
−Conduct periodic training and education
−Develop internal monitoring and reviews
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20. Compliance Program
• Basic elements of a compliance program:
• Develop effective lines of communication
• Conduct internal auditing and monitoring
• Enforce standards through well-publicized disciplinary
guidelines
• Respond promptly to detected violations and take
appropriate corrective action
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21. The presentation and materials are intended to provide information on legal issues and should not be construed as legal advice. In addition, attendance at a Godfrey & Kahn, S.C.
presentation does not create an attorney-client relationship. Please consult the speaker if you have any questions concerning the information discussed during this seminar.
OFFICES IN MILWAUKEE, MADISON, WAUKESHA, GREEN BAY AND APPLETON, WISCONSIN
AND WASHINGTON, D.C.
Thank You
Wendy Arends, Esq.
Godfrey & Kahn, S.C.
(608) 284-2659, warends@gklaw.com
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Notas del editor
AKS prohibits intentionally trying to increase referrals of federal health care programs business by giving the other party something of value;
27 month investigation by the US DOJ, HHS. State of Georgia and Andre Valentine (Whistelblower) paramedic
When other forms of transportation could endanger the health of the client
If the client is in End-Stage Renal Disease, needs dialysis, and transportation to a dialysis facility
If transportation is needed to obtain treatment or diagnose for a health condition
If the client has a written order from a physician stating the ambulance transportation is medically necessary
Medicare only pays for non-emergency ambulance to covered destinations for treatment, such as:
Hospital
Dialysis centers
Treatment facilities like Cancer Treatment Centers and Outpatient MRIs
Medicare will not pay if the patient ca: Can walk
Can be transported by a wheelchair
Can sit up in bed
Can be transported safely by any method other than an ambulance (car, taxi, wheelchair van, medical car, etc.)
Do not meet any of the qualifying criteria
In the past several years, DHS has conducted several state focused studies on the adequacy of both federal and state compliance of nonemergency transportation.
The case involved various allegations of MedStar submitting false claims for services provided to Medicare patients. These included:
(1) billing for transports that were not medically reasonable and necessary; - an example of this was a patient who was transported for dialysis and able to walk, not bedridden and did not require a stretcher;
(2) There were also claims submitted for services billed at a higher levels than patients’ conditions required – one allegation is that the ambulance service required advanced life support but it was not required;
(3) billed for higher levels of services than were actually provided. Billing Medicare for ambulance services provided for transportation of patients for non-Medicare covered services, for example from a nursing home to a doctor's office for a regular doctor's appointment.
Altering the actual pickup and destination, fraudulently making the service billable to Medicare, when it wasn’t.
This type of scrutiny by the government is nothing new, but the amount of the settlement was quite something - $12.7 million, in addition to MedStar having to enter into a corporate integrity agreement.
The case was brought to the government’s attention by a former employee who had been fired.
Once Medstar became aware of the investigation in late 2014, it quickly endeavored to put in place meaningful change, including revamping its ambulance billing software and training its billing employees. Medstar has worked cooperatively with the government throughout its investigation, and has taken swift action to address past misconduct. In addition, Medstar has agreed to a corporate integrity agreement with the U.S. Department of Health and Human Services.
